A 'Big Thumbs Up' for Renewable Energy

Wind turbines near the Donghai Bridge in Shanghai. Wind energy could supply up to 8.4 percent of global energy in 2050 from current levels of about 0.2 percent, according to a Intergovenmental Panel on Climate Change report. Credit
Color China Photo, Via Associated Press..Published 06-18-2010: Turbines of the Donghai Bridge Offshore Wind Farm in Shanghai. China invested almost twice as much in renewable energy last year as the United States. (Color China Photo, Via Associated Press)

BRUSSELS — Governments around the world have pledged emissions cuts aimed at keeping global warming below levels that could set off runaway climate change. So what proportion of the low-carbon energy needed to meet those goals will come from sources like the wind, sun and waves?

Most renewable sources are abundant, practically inexhaustible and far more climate friendly than fossil fuels. Some companies making equipment to harness these energies are growing rapidly.

Last month, experts advising the United Nations said renewable sources could deliver nearly 80 percent of world’s total energy demand by the middle of the century. That report, by the Intergovernmental Panel on Climate Change — the most authoritative body of experts, scientists and engineers specialized in climate change — was a welcome signal for an industry that has faltered in previous decades after government subsidies dried up and lower-cost fossil fuels made their technologies uncompetitive.

The report “is a big thumbs up for an industry that’s making huge advances in lowering costs and improving efficiency,” said Maja Wessels, global head of government affairs for First Solar, one of the largest makers of solar panels. “The experts have said that reaching high renewables targets will become very achievable.”

Governments staking out a low-carbon future also welcomed the findings.

Charles Hendry, the British minister for energy and climate change, said the report “makes it completely clear that this is a massively growing area” that could deliver “a turnaround moment for many parts of the economy.”

Even so, some financiers and environmental groups said the report underplayed the potential for renewable energy. The panel “wasn’t aggressive enough and the data were two years old,” said Gerard Reid, an analyst at Jefferies, an investment bank. “For solar panels, and offshore wind and concentrating solar power, we can get the costs down even quicker.”

WWF, an environmental group, emphasized that it had developed plans for generating 100 percent renewable energy by 2050.

Ottmar Edenhofer, co-chairman of the climate panel that wrote the report, said the findings were realistic. “Under no circumstances can we afford to omit or neglect renewables,” Mr. Edenhofer said by telephone. “But we must remember that there is more than one way to achieve a low greenhouse gas economy.” He was referring to alternatives to renewable sources like nuclear power and technologies under development to limit the damage of fossil fuel use by capturing and storing carbon dioxide before it reaches the atmosphere.

Some of the renewable sources with the greatest potential to deliver large amounts of energy, like certain kinds of solar power, remain expensive compared with burning fossil fuels, he said. And integrating a wide variety of renewable sources into existing power grids would be a huge technical and financial challenge, he added.

That caution was echoed by separate report released on May 24 by the International Energy Agency. While the agency found that biomass, geothermal and hydropower provide a steady stream of power and pose no greater challenge than conventional power to integrate into grids, other renewable sources — wind, solar, wave and tidal energy — fluctuate with the weather and are often in places that lack grids.

“When shares of variable renewables amount to just a few percent, a philosophy of ‘connect and manage’ will usually suffice,” said Nobua Tanaka, executive director of the I.E.A. Greater use of renewable sources means that “this will need to change,” he said.

A summary of the climate panel’s report was published on May 9, after 194 governments agreed to the text. The report was based on a comparison of 164 evaluations of the technology and provided the most comprehensive analysis to date of trends and perspectives for renewable energy. The panel was expected to publish a full report of more than 900 pages by mid-June, once scientists have completed final checks.

The report found that six sources — bioenergy, wind, solar, geothermal energy, hydropower and ocean energy — currently accounted for 13 percent of global energy supply. In one of the least optimistic outlooks for the sector examined by the panel, the world would generate 15 percent of its energy needs from those same six sources by 2050. But in one of the most optimistic projections, the world could generate 43 percent of its energy needs from those six sources by 2030 and 77 percent by 2050.

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Renewable energy also would create jobs and help accelerate access to energy for 1.4 billion people without electricity.

The panel expected costs for many of the technologies to fall, though they still would be formidable. Reaching a point where renewable sources would contribute significantly more low-carbon energy than nuclear power and fossil fuels by midcentury will require investments by governments and the private sector of up to $5.1 trillion through 2020, and up to $7.2 trillion from 2021 to 2030.

Solar still represented just 0.1 percent of total global energy supply. Ocean energy projects are at demonstration or pilot phases and unlikely to become significant contributors before 2020.

Geothermal stands at 0.1 percent of global energy supply. Tests are still under way to determine if so-called enhanced techniques to raise output can be viable. Hydropower already accounts for 2.3 percent of global energy supplies, but its expansion is partly limited by the effects that dams and reservoirs can have on local ecology and water systems.

Biomass, including biofuels and traditional cooking and heating, is the most widely used renewable source, accounting for 10.2 percent of global energy supply. But using trees and crops for fuel creates more emissions when new land is cleared to make room for displaced crops. “Biomass may be a major source of renewable energy, but it also has quickly become one of the most contentious sources,” Mr. Edenhofer said.

The outlook for wind was probably the clearest. It could supply up to 8.4 percent of global energy in 2050 from current levels of about 0.2 percent, according to the report. Yet the report noted that “public acceptance” of unsightly windmills was still a problem.

Over all, renewable energy still needs to grow by a factor of about 20 before it can contribute substantially to efforts to reduce greenhouse gases.

Since the evidence used in the report was compiled, additional factors that could dampen interest in renewable energy have emerged, including the rapid development of shale gas in the United States. The boom in shale gas extraction has lowered energy prices and could make relatively expensive renewable technologies less appealing.

In Europe, the shale gas industry is far less developed. But the more immediate challenge is how governments have shrunk or delayed plans for renewable energy after a sovereign debt crisis led to cutbacks and continues to cast a shadow over the prospects for growth.

“A lot of policy enthusiasm in the developed West has been tempered by austerity,” said Nick Robins, chief analyst for climate change at HSBC. “On the other hand, China and India still are growing quickly and they have the imperative to invest in renewable energy to meet new demand.”

That more promising assessment of China and India is borne out by the panel’s report, which found that developing countries already host 53 percent of the world’s electrical generating capacity from renewable sources.

The Chinese “now look at renewables as part of the energy mix, while we in the West still look at them as expensive and a nice to have, rather than a necessity,” said Mr. Reid of Jefferies.